Marginal salary increases for Cognizant senior management

While the base salary went up marginally by under 5%, the variable pay received for most was in the 70-80% range.Priyanka Sangani | ET Bureau | April 21, 2017, 16:16 IST

A tough year for the IT industry resulted in a muted increase in compensation for the senior management at Cognizant Technology Solutions. As per an SEC filing, CEO Francisco D'Souza's annual compensation increased marginally from $11.951 mn in 2015 to $12.030 mn, including total compensation under SEC rules and RSU grants.

Similarly, Rajeev Jain, who had taken over as President in September 2016 following the resignation of Gordon Coburn received $7.09mn as against $6.54mn in 2015.

While the base salary went up marginally by under 5%, the variable pay received for most was in the 70-80% range. The company reported annual revenues of $13.49bn for 2016, up by 8.6% over 2015, after reducing guidance thrice during the year.

2016 has been a tough year for the IT services company, and industry as a whole, which is struggling with multiple challenges from the H1B visa issue to automation. Last week, Infosys had said that CEO Vishal Sikka received only about 60% of the salary he was eligible for, as certain targets were not met.

Cognizant recently announced that it had reached an agreement with activist investor Elliott Management, which has a 4% stake in the company, to return $3.4bn to shareholders over the next two years through a mix of share repurchase and dividends. It also said that it would improve its non-GAAP operating margins to 22% by 2019. The non-GAAP operating margin for the quarter ending December 2016 was 18.7%.

Cognizant has also indicated that it would be cutting more jobs as part of its annual appraisal process this year given the move towards digitisation and automation and the overall environment in the industry.